Agricultural Productivity and Non-Farm Employment : Evidence from Bangladesh
This paper provides evidence on the impacts of agricultural productivity on employment growth and structural transformation of non-farm activities. To guide the empirical work, this paper develops a general equilibrium model that emphasizes distinc...
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| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2016/05/26401889/agricultural-productivity-non-farm-employment-evidence-bangladesh http://hdl.handle.net/10986/24520 |
| Summary: | This paper provides evidence on the
impacts of agricultural productivity on employment growth
and structural transformation of non-farm activities. To
guide the empirical work, this paper develops a general
equilibrium model that emphasizes distinctions among
non-farm activities in terms of tradable-non-tradable and
the formal-informal characteristics. The model shows that
when a significant portion of village income is spent on
town/urban goods, restricting empirical analysis to the
village sample leads to underestimation of
agriculture's role in employment growth and
transformation of non-farm activities. Using rainfall as an
instrument for agricultural productivity, empirical analysis
finds a significant positive effect of agricultural
productivity growth on growth of informal (small-scale)
manufacturing and skilled services employment, mainly in
education and health services. For formal employment, the
effect of agricultural productivity growth on employment is
found to be largest in the samples that include urban areas
and rural towns compared with rural areas alone.
Agricultural productivity growth is found to induce
structural transformation within the services sector with
employment in formal/skilled services growing at a faster
pace than that of low skilled services. |
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